Bancassurance will continue to be a pillar in insurance distribution this year, given the channel's broad market share, said the Indonesian Life Insurance Association (AAJI).
AAJI forecasts that total life premiums generated through the bancassurance channel this year will grow by 15-30% compared to 2018.
Based on AAJI data for the third quarter of 2018, the bancassurance channel contributed 42% or IDR59.19trn ($4.2bn) to total life premiums. In comparison, the agency channel contributed 39.7% and alternative channels brought in 18.3%, reported Bisnis.
AAJI Executive Director Togar Pasaribu said that bancassurance growth was generated through increasing the number of partnerships between life insurance companies and banks as well as offering more new products.
"In addition, life insurance marketing through bancassurance is also easier because the targeted market is a segment of the community that understands financial services."
To further take advantage of bancassurance opportunities, Mr Togar suggested that insurance companies carry out a survey to find out the characteristics of insurance products needed by the community.
"Many banking customers do not have insurance products yet, so that will be a great opportunity for the life insurance industry to work with banks," he said.
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